Budget Crunch Imperils Clinton 'Investments'

Since taking office last year, the Clinton Administration has won
approval of a long list of education-related initiatives, including the
Goals 2000: Educate America Act, a school-to-work transition program, a
community-service initiative, and a major expansion of Head Start. A
measure revamping the Elementary and Secondary Education Act will come
later this year.

The so-called "investment'' agenda outlined in President Clinton's
proposed 1995 budget dovetails with his legislative agenda. Indeed, the
Education Department was one of only a few agencies slated for an
increase in the budget.

But many observers say that an unrelenting squeeze on the federal
budget will make it impossible for the President to back up his
rhetoric with the funding needed to make all the new programs a
reality.

"Mr. Clinton's garden grows a lot of ideas, but new ideas are a dime
a dozen,'' said Bruce Hunter, the senior associate executive director
for external relations at the American Association of School
Administrators. "He has a serious appropriations problem.''

"We have a bare-bones budget, and we're already cutting into the
marrow,'' said an aide to Sen. Tom Harkin, D-Iowa, the chairman of the
Senate appropriations subcommittee that oversees funding for the
Education, Health and Human Services, and Labor departments.

"We can't pull rabbits out of a hat as people have always expected
us to do,'' the aide said. "There are no corners left to cut.''

Lawmakers are operating under five-year discretionary-spending caps
imposed under a 1993 deficit-reduction plan.

The Labor-H.H.S.-Education subcommittees in the House and Senate
will have about $70 billion in discretionary budget authority to work
with in drafting a fiscal 1995 spending bill--only $2.8 billion more
than they had in 1994 and about $1.7 billion less than the President
included in his budget.

A Zero-Sum Game

The problem is exacerbated by the procedural fact that the bulk of
Mr. Clinton's domestic initiatives are financed by those subcommittees,
pitting his "investment'' priorities directly against each other.

The President's budget proposed boosting Head Start funding from
$3.3 billion to $4 billion, Goals 2000 from $105 million to $700
million, and the school-to-work program from $50 million to $150
million. Those allocations alone would eat up half the subcommittees'
$2.8 billion increase--and require lawmakers to give many existing
programs less than they need to simply keep up with inflation.

The situation is even tighter than it appears to be, appropriations
aides said, because the President's request includes cuts that
lawmakers are not likely to make.

Observers also note that the budget caps on outlays--the amount
actually spent in a given fiscal year--are even tighter than the limits
on budget authority, or the total spending allowed by appropriations
bills. And outlays are what is "counted'' in deciding whether lawmakers
have exceeded the caps.

Mr. Harkin's aide said that under a worst-case scenario,
appropriators would be able to finance only 18 cents for every dollar
by which the Clinton budget proposed increasing spending on programs in
his panel's jurisdiction. Last year, he said, the subcommittee was able
to provide about 29 cents on every new dollar the President
requested.

"People still don't get it--the Administration, lobbyists,
everybody,'' Mr. Harkin's aide said. "The numbers just don't add up,
and something's going to have to give.''

Lobbying Strategies

Some education lobbyists said that the Administration appears not to
have a coherent strategy for getting its budget proposals enacted, and
they expressed frustration at what they see as a lack of
leadership.

"There doesn't seem to be a real strategic, cohesive plan to protect
the social-service increases,'' said Susan Frost, the executive
director of the Committee for Education Funding. "The Administration
has a real problem in credibility here in the investments and the
rhetoric.''

Both Undersecretary of Education Marshall S. Smith and William A.
Galston, a deputy assistant to the President for domestic policy,
disputed those charges, but declined to discuss the Administration's
lobbying strategy.

An aide to Rep. Neal Smith, D-Iowa, the acting chairman of the House
Labor-H.H.S.-Education appropriations subcommittee, said that
appropriators had asked Education Department officials to set
priorities for the proposed increases, but said that the list would not
be made public.

Undersecretary Smith would neither confirm nor deny the list's
existence; Sally H. Christensen, the director of the Education
Department's budget service, said she did not know about any such
list.

"Clearly we're going to go to bat for the same initiatives that have
been at the top of the agenda all along,'' the undersecretary said,
referring to new Administration programs. "But those aren't the only
things we consider as really critical.''

Some lobbyists said that their strategy will be much less ambiguous.
Given the choice between money for new initiatives or for existing
programs, they said, they will lobby for the latter.

And they suggested that appropriators are likely to agree, as
midterm elections loom and constituents expect them to deliver services
they already depend on.

"We have to protect what we have and let the future take care of the
new initiatives,'' said Edward R. Kealy, the director of federal
programs for the National School Boards Association. "People don't miss
what they don't have.''

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